Buy LTIMindtree; target of Rs 7400: Motilal Oswal

Motilal Oswal is bullish on LTIMindtree recommended buy rating on the stock with a target price of Rs 7400 in its research report dated September 19, 2024.

Broker Research

September 20, 2024 / 12:23 IST

Buy

live

bselive
nselive

Volume

Todays L/H

Motilal Oswal's research report on LTIMindtree

We upgraded LTIMindtree (LTIM) to BUY on 18th July, 2024, following its 1QFY25 Results. The nascent recovery in the US BFSI was a key consideration, but our decision was also driven by LTIM's superior offerings in data engineering and ERP modernization, along with its strong ecosystem partnerships. These factors position the company well for clients’ next-gen and pre-GenAI spending. Since the upgrade, the stock has outperformed both the Nifty 50 index and Nifty IT index (LTIM gained 11.0% vs. ~2.5% for Nifty 50 and ~5.0% for Nifty IT). Going forward, we believe that the US BFS recovery will remain a key monitorable, with clients resuming ‘high-priority’ projects in this vertical (BFSI accounts for ~35% of the revenue). This, coupled with the resumption of ERP modernization projects, could catapult revenues higher for LTIM.

Outlook

However, the margin expansion and churn at the top-level management remain key concerns to our thesis. We value LTIM at 35x Sep’26E EPS. We reiterate BUY with a TP of INR7,400, implying a 16% upside potential.

For all recommendations report, click here